Tony Shepherd revealed to a Senate inquiry last week that he and a fellow audit commissioner had met the management of SBS. The government-owned broadcaster is one of the businesses under the Commission of Audit's microscope for privatisation, along with Medibank Private and Australia Post.

The audit may also recommend ways to trim funding to the ABC - although Fairfax Media understands broadcast reform is down the list of audit priorities.

The commission was due to hand in its first report to the government on January 31, however, it has been granted a two-week extension after it indicated it was struggling to meet the deadline. A second report is due in March but Treasurer Joe Hockey will keep all recommendations secret until after he delivers his first budget in May.

Mr Shepherd told senators last week that ''everything is on the table''.

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But questions have been raised over whether he should have had any contact with SBS - which requested the meeting - when he continues to advocate for pay TV providers in his position as chairman of the Australian Subscription Television and Radio Association. The group, whose members include Telstra, Foxtel and ESPN, on Monday issued an invitation to a party at Parliament House, Canberra, next month.

''Tony Shepherd AO, chairman, Astra, invites you to join the leaders and stars of Australian subscription television to celebrate the quality, creativity and diversity of content watched by seven million Australians,'' it says.

Labor senator Sam Dastyari said a clear conflict for Mr Shepherd had emerged.

''If this is not a conflict of pecuniary interest, I honestly don't know what is,'' he said. ''Only last week, [the Senate inquiry] asked the government for more transparency and this is what we get in return - a bold declaration of Mr Shepherd's commercial interests being hosted in Parliament House the very week that he claims to be independently evaluating the two public service broadcasters.

''The current chairman of DHL would never be given the chance to evaluate the sale of Australia Post and the chairman of Bupa would never be given the chance to evaluate the sale of Medibank.''

John Grant, the first assistant secretary to the secretariat of the Commission of Audit, said all potential conflicts of interest had been identified.

''Tony declared his potential conflicts of interest to the commission … it has been properly dealt with,'' he said.

Adding further pressure to Mr Shepherd's delicate balancing act is that ASTRA lodged a 14-page submission with the Commission of Audit.

Among other demands against perceived perks for free-to-air channels, it called for the $220 million Australia Network contract held by the ABC to be made immediately contestable by the private sector. Last year, the Labor government controversially torpedoed a tender that could have led to Sky News, part-owned by Rupert Murdoch's News Corporation, taking over the plum contract.